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Vikram Pandit, 'COO' of Citigroup

by: Felix Salmon May 06, 2008 | about stocks: C    
Felix Salmon

Felix Salmon

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David Enrich has gotten the first interview with Vikram Pandit since Citigroup announced that "substantially all" of the investor's in Pandit's Old Lane hedge fund had deserted it. The bad news is that either he didn't ask about Old Lane, or else he did and Pandit managed to keep his answer out of the paper. The good news however is that Enrich isn't pulling his punches in return for access:

Even executives who praise his cautious, deliberative approach express concern Mr. Pandit is taking too long to make decisions. He has earned high marks for quickly addressing the most pressing financial issues. Still, executives and investors alike complain that Mr. Pandit hasn't articulated his vision for the company...

"At a time like this, you really want people marching shoulder-to-shoulder with you," says Sanford Weill, the former CEO who engineered the 1998 merger that created the Citigroup behemoth that Mr. Pandit is still wrestling with today...

Asked about his vision for the company, Mr. Pandit says first it needs to fix the little things. "Only after we get those foundations right do we earn the right to talk about vision," he says.

Pandit doesn't think he has the right to talk about vision? Pandit has the obligation to talk about vision. That's the CEO's job. Right now he's behaving much more like a COO than a CEO, and that needs to change. Clearly, Sandy Weill's original vision for Citigroup is no longer workable, if it ever was, so Pandit needs to replace it with something else. So long as he tinkers with org charts rather than setting out a strategic roadmap, no one's going to have any confidence that he knows what he's doing or that he's a remotely effective leader.

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This article has 7 comments:

  •  
    May 06 11:43 AM
    Terrible article, absolutley non-informative, did not divulge any specifics. Basically just a tirade against Mr Pandit without backing anything. We readers expect higher standards.
    Reply
  •  
    May 06 02:24 PM
    Precisely. What vision are you going to talk about if you cannot execute? In order to execute, you need to understand what is working and what needs to be fixed.

    Articulating the vision without understanding the ground realities have brought citi to what it is today. What citi needs now is an engineer to execute rather a visionary.
    Reply
  •  
    May 06 02:52 PM
    Agreed as well. Give Pandit some time. At least he's smart enough not to make rash decisions.

    As for the "shoulder-to-shou... comment, there was one person in the WSJ article who clearly wasn't on board with the new team, and that was Krawchek.

    Some sour grapes that her star keeps falling might be expected, but when she goes that public against the new leader that quickly, it's time to push the eject button - that kind of open dissention in the ranks is just too counter-productive for this new of a leadership.

    The best signal that Pandit could give to the rest of management is to fire her and the "sacred cow tradition" that she represents at Citi.
    Reply
  •  
    May 06 03:56 PM
    I'd rather see a few months of quiet observation and careful planning rather than some loudmouthed and uninformed declaration where Citi group should be heading.

    Successful companies need CEOs who are capable of patient and careful long-term strategic planning. If someone waltzed into Citi and immediately declared that he had everything figured out, you could rightfully dismiss him as full of sh*t
    Reply
  •  
    May 06 09:20 PM
    Don't blame Mr.Pandit for trying to resolve the financial issues that the Citi faces.He inherited a financial institution subverted by the inability of the rating agencies to properly quantify the subprime related risks.He is addressing the problems created by the FED'S past policies which had driven the FF to 5.5 % driving the broad spectrum of rates higher.Higher rates had undermined U.S economy-the deceleration that had followed had destabilized the capital (non -treasury)markets ,especially the sub -prime related "structured "products. I have warned about these issues as early as June of 2005 in an intereview with Mark Gilbert(Bloomberg -London) and again on the Bloomberg TV(Brian Sullivan) on September 19,2007.Now that the FED is trying to get ahead of the curve by aggressive easing and systemic liquidity injection into the market ,the economy and the markets should stabilize.In fact all of the "repriced" sub prime products will have significant gains in the period ahead .Fiscal 140 billion dollar "jolt" will add a trillion dollar stimulus ,allowing for a multiplier of 7.
    Mr.Pandit's systemic but slow?approach will work as the market/economic rebound will allow him to make more objective decisions as opposed to critical emotionalism vented against him. Citi will become a leading giant again and Mr.Pandit will prove to be an effective CEO in the period ahead.
    Reply
  •  
    May 07 12:45 AM
    Gabe, good luck chump! You're going to need it. C is garbage; I wouldn't give you $15 for it. A "multiplier of 7"? Got news for you, buddy: America is out of real money. That's what soaring dollar prices for commodities means, at its most basic level: dollars no longer represent much of a claim to real production. Print and borrow all you want, the rest of the world is getting tired of it. Nothing Pandit can do will make any difference to C and nothing the fed is willing to do will make any difference for America. If they raise rates to 15% and let C and its brethren fail, maybe. But that's as likely as meeting Frosty the snowman on a midsummer holiday in Death Valley.
    Reply
  •  
    May 07 08:20 AM
    For Bearfund,

    First,I would ask you to be respectful of those others commenting young man!

    Secondly, look to Citi to be one of the great investment stories in the coming two years and those who invested in the call options of 1 and 2 years out will be lauded as prescient (that means forward-looking) bunch of investors on the street.
    Now be nice bear...this is a conversation...so let's be CIVIL.

    ChumpforCITI
    Reply
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